Iraq threatens to blacklist oil companies

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BAGHDAD, Aug. 16 (UPI) -- The Iraqi government said it would cut ties with any oil company that is taking action that runs counter to national laws, an official said.

Unilateral deals with the Kurdistan Regional Government are a source of contention with Baghdad, which considers the actions illegitimate. Baghdad blacklisted some international oil companies that have engaged the KRG.

Iraqi Deputy Prime Minister Hussein al-Shahristani, a former oil minister, said the central government in Baghdad would sever ties with companies dealing illegally with the KRG.

"Iraq will end dealings with any company of whatever nationality and size in the oil industry if they violate Iraqi law," he was quoted by the Platts news service as saying. "All the companies have been informed about it."

The KRG in April halted oil exports because it said Baghdad wasn't paying energy companies working in the Kurdish north. Exports this week, however, in early August as a "goodwill initiative" that the Kurdish government said should encourage Baghdad to make good on "all the outstanding payments due."

Last week, Crescent Petroleum and Dana Gas announced production at a resource field in the Kurdish north of Iraq has reached 70,000 barrels of oil equivalent per day.

Both companies started production, as joint operators, in the Khor Mor field in the semiautonomous Kurdish region of Iraq in 2008.